Terrence Burns ©2014

The 2022 Winter Games Bid Campaign is not exactly what everyone wanted – or intended. But, like a slightly ugly baby it’s here, and we have to love it.

What happened?

Here are some facts:

Lviv pulled out of the race due to the instability of the Ukrainian government during a time of national crisis.

Krakow pulled out the race due to a national referendum, the citizens citing Games size and cost versus legacy as a concern.

Stockholm pulled out of the race, it citizens citing Games size and cost versus legacy. Our Swedish friends are now having second thoughts. Personally, I think the IOC should put the Winter Games brand – which by any metric is hurting –  before the IOC’s process in terms of priority and consider letting Stockholm back in.

Oslo pulled out of the race due to a national referendum, the citizens citing Games size and cost versus legacy and the IOC’s image and reputation as concerns.

Munich chose to not even bid (unfortunately) citing Games size and cost and the IOC’s image and reputation as concerns.

What is interesting, even fascinating, is that not one of these cities cited “the cost of bidding” as a reason to withdraw or not bid.

Not one.

Zero.

Cities choose to spend whatever they wish to spend in order to bid on the Games. The figures range from the incredible $US150 million that Tokyo 2020 supposedly spent to the relatively responsible $US43 million attributed to the Munich 2018 bid.

Why the wide gap?

Because cities want to host the Olympic Games, badly, and there is no universal standard for fiscal sobriety. It is up to the cities to determine how much they want to invest – or waste. The IOC does not dictate it; in fact they try to minimize it.

For the 2020 Games campaign the IOC wisely reduced the number of continental presentations Bid Cities had to attend and present their bids.

For the 2018 Winter Games race there were ten or so such presentations, ranging from traveling to French Polynesia to present to a hand full of people for fifteen minutes (I got some great pictures, though), to Togo, to Belgrade, to London, to Acapulco, to Seoul, to Guangzhou, to Lausanne and finally to Durban. That wasn’t cheap and frankly, it wasn’t necessary.

So the IOC changed it. No one seemed to notice and no one said, “Thanks IOC, that makes sense”. (You know, like Madrid Made Sense – fiscally responsible)

The real concern for potential bid cities is the size, scope and cost of hosting the Games versus the associated legacy. Period.

The Olympic Movement’s inclination (and exasperation in that no one seems to understand this) is to explain that there are really two costs involved with hosting the Games – the operational budget to host the Games for 17 days, and the budget necessary to build out the needed infrastructure which will serve the Host City and region for generations to come. I gave up on the “OCOG versus Non-OCOG” nomenclature for civilians a long time ago.

Here is an analogy that might help. The total four year tuition costs to attend university, a good one in the United States, are about $US160,000 – 200,000+. That is what it takes to “be there” for four years. The return on that investment however is calculated over the student’s lifetime – not during the four years of attendance. It’s an investment in the future.

Similarly, the infrastructure costs required to host a Games, normally $US5 – 10 billion (a guess), are for things such as airports, facilities, power plants, water treatment plants, roads, etc., that will improve the quality of life for the Host City for generations. The government and the citizens of the Host City and nation pay for these costs.

The point here is that these cities and nations would eventually incur these type costs, regardless of the Games. I call it the “3:1 ratio rule”; i.e., in 7 years cities build 21 years worth of (hopefully) needed infrastructure.

The total 17 days operating costs for the Games  – ranging from $US2.2 for winter to over $3 billion for summer – are meant to be offset by revenues generated by the Games. Most Host Cities claim to break even or make a small profit (what else would they say – it’s like grading yourself on a final exam). The local Olympic Organizing Committee manages and pays for the costs associated with this budget from revenues raised through sponsorship, television rights fees, licensing, etc.

Ok – so we all know that Russia spent a reported $US51 billion to build a new city for the Sochi 2014 Winter Games. Here’s the thing: it was their choice to do so and it was their money that was spent.

The $US51 billion figure may prove to be the most maligned number in sports history. It is a figure thrown about to illustrate the supposed pomposity of the IOC, the absurdity of hosting an Olympic Games and a oblique criticism of “everything Russia.” Including Putin.

Did anyone ever consider that Russia chose to use the Olympic Games as a catalyst to improve and upgrade Sochi and the surrounding region – this is no different from say, London 2012’s aspirations, though admittedly the scale was different. The Russians just had the ability – and the cash – to build a new city from scratch in an area that was neglected for, well, forever. So they did it.

But guess what? Sochi’s $US51 billion has nothing whatsoever to do with any city that desires to host a future Olympic Winter Games. Nothing. Zero.

Why is that so hard to understand?

It is hard to understand because 1) no one bothered to explain it properly, and 2) various and numerous entities have used it, very adroitly, and to demonstrate opposition, resentment and disdain for the Olympic Games and the IOC. It was almost too easy not to.

Before you leap, no, I am not blaming the media or the citizens of any of the cities or nations who decided “no thanks, IOC”. I am not. But what I am saying is that because someone did not explain the facts, someone did the world a disservice. And maybe that “someone” is us – those of us who live and work in and alongside this special thing called “The Olympic Movement.”

Did the IOC have a role in this debacle? Sure, but what’s the point of playing the blame game now? It’s easy to criticize after the fact.

At the end of the day the IOC is a private club and the Games is their event. “It’s their rodeo” as we say here in the US. And if one takes the time to review the IOC’s history over the long arc of the Olympic Movement, I strongly believe that the IOC get it right more often than not, in fact a lot more often. If the IOC were a Major League Baseball player with that batting average, he would be in the Hall of Fame.

The real challenge for the IOC is that they sell “perfection” as embodied in the Olympic brand. People expect more from the Olympics, and therefore the IOC’s margin for error is the size of a pinhead versus the football pitch that other entities – such as FIFA – get to stumble around on and make mistakes.

Can the IOC do better?  Of course they can.  Can you?  Look in the mirror.  Let’s stop complaining and let’s start believing again.  The Olympics are worth it.

I’m looking forward to the session in Monaco to see what changes Agenda 2020 will bring; although, it was recently pointed out to me that only the IOC would hold a meeting in Monaco to discuss cost cutting – but that’s for another post.

I’m betting they will get it right – or most of it, and shouldn’t we all want that to happen?